FEDERAL BUDGET: No budget relief for single-breadwinner families

News Weekly, May 29, 2010

Special report

"The Rudd Government's Budget will not alleviate financial strain for Australian families facing unaffordable housing, rising interest rates and the high cost of raising children - Australia's future taxpayers," a spokesman for the Australian Family Association, Tim Cannon, has said.

"The recent Budget's modest tax cuts for low-income earners are likely to be swallowed up by inflation and rising interest rates."

Mr Cannon suggested that, in the longer term, an increased superannuation rate of 12 per cent and the 50 per cent tax concession on interest earned from savings would together provide a welcome boost to Australia's overall savings rate.

"However, the high cost of raising a family and repaying a mortgage means that actually saving money to deposit in the bank is simply not a reality for most Australian families - especially single-income families."

Meanwhile the budget provides no effective measures to address the chronic shortage and decreasing affordability of housing in Australia.

The Rudd Government's failure to provide substantial relief for Australian families in its budget anticipates the introduction of the forthcoming paid parental leave scheme, which will entrench discrimination against single-breadwinner, two-parent families by providing a generous maternity payment which is only available to women who have been in the paid workforce.

Mr Cannon said: "Mothers providing at-home care will receive a substantially lesser maternity payment, effectively penalising them for not placing their children in institutional day-care and entering the paid workforce.

"The push to force children into institutional care has been intensified by the government's plan, outlined in the May 11 budget, to abolish the one-off support payment of $1,500, currently available to mothers who wish to start family day-care in their homes."

"The result", said Mr Cannon, "is that Australian families face mounting pressure from the government to ensure that both parents are in the paid workforce, and that their children are in institutional day care.

"For single-income families, the choice to provide at-home care for their children is a costly one."

Another pressing concern for family groups around Australia is the push by both major federal political parties to introduce paid parental leave that would discriminate heavily against single-breadwinner households.

The Australian Family Association and Kids First Australia sent an open letter to all federal politicians, protesting that it the Rudd Government's paid parental leave is unfair to single-breadwinner two-parent families where the mother stays at home to raise the children.

These families will miss out on the scheme and be almost $2,000 worse off than families with a mother who has recently been in the paid workforce.

The letter called for amendments to the Paid Parental Leave Bill to extend the scheme's 18-week minimum wage benefit to stay-at-home mothers and to ensure business is not lumbered with avoidable administration costs.

Kids First spokeswoman, Tempe Harvey, said: "The Rudd scheme will cost business $200 million in the implementation year and at least $100 million in later years.

"Most of these expenses could be avoided by removing employers as additional paymasters for what is, in reality, a government benefit.

"The Coalition has repeatedly pledged to provide fairer support for stay-home mothers.

"The most effective way to do this is to extend the bill's benefits to all mothers and get rid of the 'paid work' eligibility test.

"With all mothers supported equally, the baby bonus could then be scrapped and savings put toward funding the extended scheme.